Envi-business org demands review of tax breaks for EVs

Philippine Business for Environmental Stewardship Secretary General Felix Jose Vitangcol urged the government to amend the tax incentives for electric vehicles as it ‘lacks inclusivity.’

This was after the Palace released Executive Order No. 12 series of 2023 which modifies the tariff rates for EVs to help mainstream their use among Filipinos.

EO12 lowered the tariff rate for certain EV types ranging from five to 30 percent to zero percent import duty.

Under the EO, EVs such as kick scooters, pocket motorcycles, and self-balancing cycles are included in the tax breaks. On the other hand, two-wheeled electric motorcycles are still subject to a 30 percent import duty.

In a statement posted on their Facebook page, Vitangcol stated that there is a problem in the EO since only a limited portion of the population can afford to buy four-wheeled vehicles.

“Only more affluent Filipinos – indeed a limited segment of the population – can afford to buy four-wheel vehicles, and hence enjoy these incentives,” Vitangcol said in their statement last February 16.

The organization reiterates that most motorists in the country use two or three-wheeled vehicles, including public utility jeepneys.

The Land Transportation Office documented that almost 8 million units of motorcycles will be registered in their office in 2021.

“It is also they who are already perennially burdened by the soaring prices of basic goods and hampered by their limited income to provide for their families,” he added.

PBEST asserts that more Filipinos should be encouraged to shift to alternative energy regardless of their socio-economic status and the types of their vehicles.

“This is why the government must make these tax incentives more inclusive,” the Secretary-General addressed.

Vitangcol also said that the government’s role is to spearhead the country’s shift to electric vehicles as it will lessen the nation’s dependence on fossil fuels.

According to the Statista Research Department, the power production in the Philippines is still dominated by coal at 47.6 percent, other fossils at 18 percent, and gas at 10.7 percent, which totals 76.3 percent.

Various types of renewable energy like wind, solar, bioenergy, hydro, and other renewables share 23.7 percent of the country’s total power source.

The EO12 aims to help Filipinos to adapt to the usage of e-vehicles while decarbonizing and reducing the carbon emissions caused by fueled-run vehicles.

Since the Philippines is one of the most vulnerable countries to climate change, shifting to EVs is one of the country’s solutions to help weaken its effects and go full electric by 2040.

To help mainstream the use of EVs and the development of infrastructures that can cater to the industry, Republic Act No. 11697, commonly known as the Electric Vehicle Industry Development Act, was passed along with other landmark policies.

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